Novato's empty spaces could become bustling commercial centers

Some of Novato's emptiest corners could be transformed into bustling centers with shops, offices, hotels and restaurants if development plans under discussion by the City Council come to fruition.

Currently home to a cement plant, the northeast side of Redwood Boulevard north of Olive Avenue could yield the city as much as $1 million annually in sales and property taxes, according to a city staff report. Hanna Ranch, in central Novato at the southern end of Rowland Boulevard, could bring in as much as $660,000, according to the preliminary estimates in the report.

Hamilton Field is another area the city is studying, though its income potential hasn't been figured out yet. Other properties, including airplane hangars at the former military base, office buildings in various locations and the former Birkenstock building, could bring in as much as $1.5 million annually, the report said.

Developing the properties is important because "the two major revenue sources for the city are property tax and sales tax," Chris Stewart, Novato's economic development manager, told the council in a February presentation.

"Numerous parties are looking at Redwood Boulevard and Hanna Ranch. I expect within a few months decisions will be made to locate new businesses at those two locations," Stewart said in an interview this week.

The city collects about $6.5 million in sales tax annually and $12.9 million from property taxes. The council is trying to come up with ways to increase this income before funds from Measure F, which is making up for city income shortfalls, run out in March 2016.

"The question is: How do you make that pie bigger through economic development?" said Cathy Capriola, Novato's assistant city manager, in a presentation to the council.

For each of the three areas — Redwood Boulevard, Hanna Ranch and Hamilton — there are different potential approaches for generating income outlined in the staff report.

"For the Redwood corridor, there is a range of what we could do," said Councilwoman Madeline Kellner in an interview this week.

The first option, city retail, "is oriented toward things the people who live in the city would do. Nobody would drive miles out of their way to go to a coffee shop, but many people would like to have one in their neighborhood," Kellner said.

The staff report estimates that this option would bring in about $550,000 annually, though Kellner emphasized that such numbers are preliminary ballpark figures.

Regional retail stores such as Crate & Barrel, Bed, Bath & Beyond or Nordstrom Rack are the second option — stores people would drive from other areas to visit. This option would bring an estimated $730,000 annually. Finally, combining housing with the retail option would bring an estimated $1 million annually.

"I think it would typically be retail that we would be getting in there — national chain types of outlets. Those are the kinds of tenants who are looking at that property now," Stewart said in the interview. "The reason it's important is that both San Rafael and Petaluma are opening Target stores in 2013. We're going to lose retail dollars. Our goal is not just to retain the retail sales tax we have, but to grow it."

With Hanna Ranch, creating 34,700 square feet of retail space could generate an estimated $72,000 annually; building office space in addition to the retail space could bring in $145,000; and building a 116-room hotel plus restaurants could generate $660,000, the report said.

There aren't any formal plans for Hamilton yet because the director of Hamilton Base reuse, Scott Ward, who was hired in January by the city, is still developing proposed plans. Development plans for other areas are also in the works.

Kellner said the council will take into account the results of a couple surveys posted on the city website when deciding which approaches to use.

"One is a shopping survey for residents and one is for businesses in town to find out what would be helpful for them," the councilmember said. The site is at http://www.ci.novato.ca.us. The surveys "will give us an idea of what people are leaving town for and what other people would be willing to come here for," Kellner said.